Standing Committee E

[Mr. Peter Atkinson in the Chair]

Communications Bill

Ordered, 
That the Order of the Committee of 10th December 2002 (as amended on 12th December 2002) be further amended as follows— 
 (a) in the Table, in respect of the nineteenth sitting, in the third column, the words '11.25 am' be omitted; 
 (b) in the Table, in respect of the twentieth sitting, the words in the second column be omitted and the following words be inserted— 
 'Clauses 276 to 284, Schedule 11, Clauses 285 to 326, Schedule 12, Clauses 327 to 333, Schedule 13 and Clause 334 (so far as not previously concluded)'; 
 (c) in the Table, in respect of the twentieth sitting, in the third column, the words '5 pm' be inserted.—[Dr. Howells.]

Clause 302 - Local content and character of local sound broadcasting services

Amendment proposed [23 January]: No. 603, in 
Clause 302, page 261, line 19, at end insert— 
 '(7A) Before drawing up or revising the code, OFCOM shall have regard to the extent to which matters they are required to secure under this section are, or may be, secured by effective self-regulation; and, in the light of that, to consider to what extent it would be appropriate not to draw up, modify or withdraw a code under this section. 
 '(7B) In determining for the purposes of this section whether procedures for self-regulation are effective OFCOM may take account not only of self-regulation independent of those to whom it applies, but also of the extent to which the matters to be secured under this section are being, and are likely to be, secured without the further imposition of a code.'
 Question again proposed, That the amendment be made.

Peter Atkinson: I remind the Committee that with this we are taking the following:
 Clause stand part. 
 New clause 41—Local content of local sound broadcasting services 
'(1) It shall be the duty of OFCOM to secure that appropriate local content is included in the programmes broadcast by local sound broadcasting services. 
 (2) In carrying out its duty in subsection (1), OFCOM shall— 
 (a) take all local sound broadcasting services receivable in any area together as a whole; and 
 (b) take into account the results of research carried out under subsection (7)(a); and 
 (c) take into account the extent to which the expectations of listeners for local content (under subsection (7)(a)) are being met by other services receivable within the area; and 
 (d) take into account the degree to which any action taken by OFCOM pursuant to this section may affect competition between local sound broadcasting services and any other class of service. 
 (3) OFCOM must draw up or agree a code giving guidance as to how the requirements of subsection (1) should be satisfied and, in doing so, shall have particular regard to the desirability referred to in section 3(3)(c) of promoting and facilitating the development and use of effective forms of self-regulation. 
 (4) The code may, in particular include guidance as to the relevance of different descriptions of local content included in local sound broadcasting services. 
 (5) From time to time, OFCOM may revise the code or direct that it should be revised. 
 (6) The code and every revision of the code should be published in such manner as OFCOM considers appropriate. 
 (7) Before drawing up or revising the code, OFCOM must— 
 (a) conduct research into listeners' expectations of local sound broadcasting services and other services receivable within any area concerned, including the extent to which they expect local content to be broadcast; and 
 (b) consult with persons holding licences to provide local sound broadcasting services or persons appearing to represent such persons, or both. 
 (8) In this section, ''local content'', in relation to a local sound broadcasting service, means content (including news or information) which is of particular interest— 
 (a) to persons living or working within the area or locality for which the service is provided; or 
 (b) to persons living or working within a part of that area or locality; or 
 (c) to particular communities living or working within that area or locality. 
 (9) References in this section to persons living or working in an area or locality include references to persons undergoing education or training in that area or locality. 
 (10) A code drawn up as a result of subsection (3) shall not have the effect of varying an existing sound broadcasting licence.'.

John Whittingdale: Good morning, Mr. Atkinson. We have spent a little time already on amendment No. 302 and I shall do my best not to recap the arguments that have already been made. Nevertheless this is an important part of the Bill as it sets the framework in which local radio will have to operate in future. The Government have made some movement from their original proposals for ownership restrictions on radio stations and that is very welcome. In their place, this clause is there to protect the local character of a station. The Government are correct to focus less on who owns the station than what its programme output should be.
 Rather like my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), I was struck by the Minister's remarks when we were debating clause 301, particularly when he said: 
''This is meant to be a deregulatory piece of legislation and we do not want to be too prescriptive in dictating how Ofcom . . . should draw up a localness code.''——[Official Report, Standing Committee E, 23 January 2003; c. 727.]
 That is a very welcome principle, and perhaps it should also be applied to clause 302. 
 It has been argued that to provide the protection of localness against any possible risk that might be posed by the liberalisation of ownership and permitting overseas ownership, Ofcom should have a duty to protect and promote localness. 
 Hon. Members might remember that I referred to one of my local stations in Chelmsford, Dream 107, and the way in which it was committed to participation in its local community. The character of the station was very much based upon its local links and its participation in community activities. That was its selling point. That brings me to my central point: 
 for successful commercial radio operators, localness is a key component of their programming for commercial market-driven reasons and not because Ofcom has told them that that is what it should be. Anyone running a radio station recognises that. 
 I think that my hon. Friend the Member for Lichfield (Michael Fabricant) made the interesting observation that Clear Channel—and a lot of the discussion around ownership seems to get back to what Clear Channel might or might not do—had had to recognise in Australia that localness did matter, and having started off by rather abandoning the local identity of their stations, that had proved very unsuccessful, so they had to move back in that direction.

Brian White: Is not one of the lessons of that that it is very hard to rebuild that localness having lost it and should we not be doing something to prevent it from being lost in the first place?

John Whittingdale: I am not sure whether that is true. In particular, I point to my own experience in Chelmsford, where Dream 107 has recently been taken over by Tindle Radio. It has rapidly won back audience share because the station had not previously been identified as being locally based. There is a great willingness on the part of listeners to respond to local appeal. The dilemma is how to achieve that—whether it requires the intervention of Ofcom to prescribe local content or whether we should leave it to the market. Ralph Bernard, who addressed the Westminster Media Forum about the Bill last December, said:
''Localness is a key selling point to listeners—it has to be when our competitors are generally regional or national—and advertisers in an area are much more likely to support a radio station that is a vibrant local business with its roots deep in the local community. So we're experts on what makes a local station really hum, which aspects are relevant to our listeners, which events are going to draw a crowd, which local institutions deserve support.''
 He continued: 
''Against this background of in-depth local expertise, the Bill proposes that a regulator—based principally in London—should judge whether a station is local enough. The clause seeking to deliver another bit of dynamism to consumers takes no fewer than ten sub-paragraphs to meander its way through the subject—and yet this is something that, if we get it wrong, will cause our stations to lose audience and advertisers faster than any regulatory process could react to.''

Chris Bryant: I am grateful to the hon. Gentleman. I presume that he is now about to make the point that the market alone is most likely to provide localness. However, Red Dragon FM in Wales and its sister station in London, Capital FM are virtually identical in terms of their play list. The only difference between them relates to a few populist events in the summer. So is it not essential to make sure that we jig the market a little bit? It will not do it all on its own.

John Whittingdale: Obviously, I am not familiar with Red Dragon FM, although clearly if the situation is as the hon. Gentleman describes, listeners will look elsewhere for a local service.

Michael Fabricant: I am familiar with Red Dragon FM as I was involved in setting it up—[Interruption.] That was before I became a Member of Parliament. One of the reasons why Capital Radio took it over was that its audience figures were falling. The play list that the hon. Member for Rhondda (Mr. Bryant) referred to is more popular with its audience than it was previously.

Chris Bryant: Because it is not local.

Peter Atkinson: Order. This is an intervention, not a debate on Red Dragon radio station.

John Whittingdale: My hon. Friend's intervention is most helpful. Perhaps we should attempt to find a radio station in Britain that he did not play a part in setting up. However, I am in some agreement with the hon. Member for Rhondda on one point. Nobody is saying that there should not be a requirement for some degree of local content and that is a trade-off for the relaxation in ownership rules, which most people would accept. It brings me to the key question: what is local? Most people who listen to a local radio station would say that local means that there should be regular local news items and local traffic reports saying what is happening in Acacia avenue. A local station should participate in local community events, and provide a platform for local musicians and entertainment groups. All that relates to content—about what is broadcast. I am not sure whether, in order to ensure that a station is local, it is necessary to prescribe the location of its studios, who it should employ and measures which are not to do with the content of what is broadcast, but its production.

Chris Bryant: I would be absolutely delighted if Red Dragon, FM which I listen to every day when I am in Wales, provided a platform for local bands. I admit that Kylie Minogue has family from Maesteg, but I do not think that that makes her a local musician that Red Dragon FM is positively promoting by playing her and Robbie Williams 25 times a day. The play list is very prescriptive. That applies to many commercial stations, as they know that it is what succeeds in the market.

John Whittingdale: I do not think that there is a great distance between the hon. Gentleman and myself. I agree with him that content is important and I do not dispute the duty on Ofcom to promote local content, although I suspect that if Red Dragon FM played nothing except local bands in garages in the Rhondda and none of Kylie Minogue it might lose listeners rather rapidly, although I am sure that there are extremely good bands in the garages around the Rhondda.

Michael Fabricant: When Swansea Sound, the radio station based in Gorseinon, got its licence, its licence was concerned with the provision of Welsh language programming as well as ordinary programming. It built a recording studio as part of its radio station and now finds it under-utilised. Although people like hearing the news in Welsh, they are not so concerned about listening to Welsh music.

John Whittingdale: I am sure that the listeners and owners of Red Dragon FM will be fascinated that we have spent so much time arguing about whether or not
 it is local. Let me move on to a more general point. My concern is not so much about content, but about the additional prescriptive nature of the clause in relation to the other factors that the Government appear to consider necessary to prescribe in order for a station to be local. Those are essentially contained in clause 302(4), which says:
''Those factors are—
(a) the employment or other use for the purposes of the service of persons living in, or otherwise having connections with, the area or locality;
(b) the provision to such persons, in connection with the provision of the service, of opportunities for training and development'
(c) the use of premises within the area''
 It seems to me that who the station employs, how much they train them and how they use their premises are not central to whether or not the station could be defined as local. For that reason a number of the commercial radio companies regard clause 302 as far too prescriptive and that this provision is against the spirit of light-touch regulation. Indeed, the Commercial Radio Companies Association said: 
''This is an astonishing leap from a proposed duty to protect output to a recipe for interfering in microregulation.''
 It continues: 
''Perhaps 302's greatest weakness is its apparent abandonment of listeners. Nowhere in these 10 sub-clauses is there any requirement for them actually to go out and canvass the views of real listeners. It is an entirely subjective clause which lets OFCOM decide whether or not it thinks that a station is genuinely serving its local listeners.''

Kim Howells: I thank the hon. Gentleman and I have enjoyed listening to him. If he puts down his brief from Mr. Ralph Bernard and his colleagues, is he saying that nobody from a locality should be employed by a radio station, nobody should be trained and that the premises should be somewhere other than the locality?

John Whittingdale: Of course I am not saying that. I am saying that it should not be necessary to write into the Bill that Ofcom should be able to judge whether or not a radio station has premises that are local enough to its area in order for it to meet the requirements of the Bill. The broadcasters themselves should decide those matters and as long as the broadcaster is providing a content output that the listener believes to be local, that is what should determine whether or not they meet the local requirement.

Chris Bryant: The logic with which the hon. Gentleman is enticing us is that he would be quite happy if Capital FM broadcast Red Dragon from central London, with nobody based in Cardiff or indeed South Wales. As far as he is concerned, it would still be a local broadcaster.

John Whittingdale: My suspicion is that Capital FM would find it very difficult to meet the local content requirement if it were broadcasting from London and did not employ anybody from the Rhondda. However, if that were the case and if the listeners turned to the hon. Gentleman and said ''We think that Red Dragon is a brilliant local station. Its programming is becoming essential to our lives and to understanding the workings of our local community'', the fact that it
 happened to be broadcast out of London rather than the Rhondda valley would not be very important. It might be quite difficult to achieve, but the important factor is what people are listening to. It is the key.

Chris Bryant: I am sorry to harry the hon. Gentleman, but it seems to me that most commercial radio stations have learned in the past 10 years that it is valuable to them physically to place themselves somewhere where there a lot of footfall as local radio is about ownership. However that does not necessarily come from the market. Sometimes commercial broadcasters have to be told.

John Whittingdale: The hon. Gentleman is right that broadcasters have learned that that is the case.

Michael Fabricant: Totally wrong!

John Whittingdale: My hon. Friend is disagreeing with me now.

Michael Fabricant: No. The hon. Member for Rhondda (Mr. Bryant) is totally wrong. My hon. Friend is right.

John Whittingdale: That is all right then.
 The central point that I am trying to make is that the provision in the Bill should apply to the content of the programmes. I see no reason why the factors listed in subsection (4) should be necessary to be prescribed by statute in order to meet the local content requirement. If they fail to meet the local content requirement they will be in breach of the conditions laid down by Ofcom.

John Greenway: Even if, despite my hon. Friend's articulate rendition of all the arguments against the clause, the Minister still wants to keep the clause in the Bill, as he implied in his own intervention, does my hon. Friend not think that the Committee should consider the amendment tabled by my hon. Friend the Member for South Cambridgeshire on the basis that it provides an opportunity for a self-regulatory regime with the powers in clause 302 merely as a long stop should the kind of problems that the hon. Member for Rhondda is suggesting might occur. My hon. Friend and I do not think that they will, but if they did that would be a long-stop power. Surely this should be a self-regulatory matter.

John Whittingdale: My hon. Friend is absolutely right. My preferred option would be that the Government take away clause 302, redraft it in a way that is far less prescriptive and less likely to micromanage the workings of individual radio stations. If the Minister is unwilling to do that, the amendment tabled by my hon. Friend the Member for South Cambridgeshire will at least represent an improvement on the way in which Ofcom will operate in future, so I would certainly strongly support it.

Michael Fabricant: Does it not demonstrate the ignorance of the hon. Member for Rhondda about the way in which broadcasting works, and indeed that of Labour Members, that Swansea Sound is based in Gorseinon near Gowerton, and not in Swansea and Southern Sound is based in Portslade and not in Brighton. The reason for that is that what is important
 is what comes out of a radio loudspeaker and not footfalls as the hon. Member for Rhondda said.

John Whittingdale: I agree entirely with my hon. Friend, whose knowledge of the location of Welsh radio stations leaves me in amazement.

Chris Bryant: Just to correct the hon. Gentleman, it is self-evident that the ''rocking tower'' which was Capital FM was a significant part of how that station sold itself. It would not have chosen to move to Leicester square unless it thought that its location was important.

John Whittingdale: I have probably tried your patience for long enough, Mr. Atkinson. It is now for the Minister to respond.

Kim Howells: One of the aspects of local radio that we value most is its localness—its ability to be part of the communities it serves, as my hon. Friend the Member for Rhondda pointed out. To support his argument, let me say that it is sometimes a lot quicker to get from Leicester square to the middle of Cardiff than to get from Treherbert in his constituency to the middle of Cardiff, because the economy is booming, the roads are packed and the railways are full. It is precisely because we value the quality of localness that we want to have a long-stop power to preserve it, and that is what the clause provides. It is not about imposing new obligations on local radio stations, nor about getting involved in the detailed management of stations. It is about ensuring that local radio continues to play a strong and valuable local role. The clause is essentially forward looking. It represents no criticism of what local radio is currently doing; it is about encouraging radio operators to preserve and develop precisely the aspects that make local radio good.
 Let me try to put the change in context. We have taken enormous steps in the Bill to liberalise the radio market. From the current 70 owners of local radio, the new rules make it possible for us, in time, to have only two dominant owners of local radio in the United Kingdom—both of which, incidentally, could be foreign owned. We believe that those changes will allow the industry to grow. They will be in the interests of the listener, but only if localness is not the victim. While the existing companies argue persuasively that it is in their interests to be local, that could change in a dramatically changed market. The duty in the clause is the safeguard of localness and the quid pro quo for greater liberalisation in the radio market. 
 The clause places a duty on Ofcom. It is designed, first and foremost, to ensure that Ofcom takes seriously its duties towards localness. It requires Ofcom to draw up a code giving guidance to ensure the local content and character of local radio broadcasting. Ofcom will have to consult on that with both the industry and the listeners. The guidance will, in essence, codify and define the requirements already in existing licences: for example, licences may refer to material that is ''locally produced and presented'', and the code could define in greater detail what that means. The code may also influence 
 the way in which Ofcom considers matters such as requests for derogations from licence obligations, or its approach to issues such as an acceptable level of networking. 
 The intention underlying new clause 41 appears to be to prevent Ofcom, when drawing up a code on localness, from considering what might be regarded as ''inputs'' and make it concentrate instead on the extent to which a service takes into account ''the expectations of listeners''—a point made by the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale). Even if we wanted to, we could not accept the new clause at this stage because it duplicates much of the effect of clause 302 without repealing it, thus causing great uncertainty about what Ofcom's duties will be. 
 Clause 302 allows the code to take into account matters such as local advertising, local employment, opportunities for training and development, and the use of premises in the area. It has been argued that the code goes too wide and that Ofcom has no business involving itself in matters such as premises and the amount of local advertising—a subject that we have just debated briefly—but I strongly believe that such arguments miss the point. The boundaries of the area that Ofcom will be able to examine have deliberately been drawn wide so as to catch all the matters that might be considered to influence the localness of a service. Ofcom does not have to include such matters in the code—that is for Ofcom to decide, but the decision lies largely in the hands of the industry. If it continues to provide good local services, the code is unlikely to touch on those matters; were the industry to drift away from localness, the code might need to be revised. That is the point. The code must be able to include all matters that might be relevant. 
 I should add that I do not accept the basic premise of the amendment, that inputs do not matter. It has long been recognised in broadcast regulation that inputs have a clear and definite effect on outputs. A moment ago, my hon. Friend the Member for Rhondda mentioned the importance of location; I agree that that is important. I would not want the example quoted by the hon. Member for Lichfield in a previous sitting, of an American company that tried to centralise production in Australia—the attempt failed miserably—to come to pass here

Andrew Lansley: My hon. Friend the Member for Lichfield said America. I said Australia.

Kim Howells: Perhaps I should have said, ''The example quoted by the Opposition, between them.''

Andrew Lansley: I hope that the Minister accepts that I intend no discourtesy to him or to the Committee, but I have to head out to lead a debate of my calling in Westminster Hall on the film industry. I hope that when I read the record, I will find that he recognised the value of self-regulation in the context of the localness code and bent towards amendment No. 603. Unhappily, rather than hear it, I shall have to wait to read it. I apologise to you, Mr. Atkinson, and to the Committee.

Kim Howells: I wish the hon. Gentleman well in his debate on the film industry. I am sorry that I shall be
 unable to answer it—I understand that my right hon. Friend the Minister for Sport is to do so. I think he went to the pictures once, in the 1960s.
 It is reasonable that Ofcom should be able to take a view on these matters. We expect it to take an interest in, for example, the degree of networking that is consistent with maintaining localness. It must be remembered that local radio broadcasters get valuable spectrum for free. In return, it is right that the regulator, acting on behalf of the Government, should be able to take a view on how the spectrum is used. 
 I am sorry that the hon. Member for South Cambridgeshire is not here to hear my response to amendment No. 603, which would require Ofcom to consider the extent to which the matters it is required to secure under the clause could be, or are already being, secured by self-regulation, and therefore whether it is necessary to draw up a code. I have some sympathy with the general thrust of the amendment, but I do not think that it is necessary. I hope that the industry will welcome the general thrust of the duty and take an active role in developing the code, which offers an excellent opportunity for the industry and the regulator to work together to develop a co-regulatory approach. 
 I welcome the comments made by the ubiquitous Mr. Ralph Bernard, the head of GWR, the largest radio group in the United Kingdom. He said: 
''OFCOM and the industry work together to develop a sensible code, all agree on how the output of the codes will be judged a success or not, and then the industry gets on with operating the system without the need for much further input from the regulator. Trust us to regulate to pre-agreed rules and I am sure we will get a positive result with benefits for consumers, advertisers and the public as a whole''.
 I could not have put it better myself. While I cannot pre-empt Ofcom's precise approach to that duty, I am sure that the Committee agrees that Mr. Bernard's approach is admirably positive, and equally sure that Ofcom will be encouraged by his words. The Radio Authority has stated: 
''The new duty to be imposed on OFCOM, to safeguard the local character and content of local radio services, places the Radio Authority's existing approach into the context of modern regulation. We welcome the proposal which will in effect codify existing rules and requirements. We hope and expect that OFCOM will look to the station operators to give effect to these regulations largely on a co-regulatory basis, which will include a consultative approach to developing the required localness Code.''
 I should add that clause 6 places Ofcom under a duty to review regulatory burdens. Subsection (2) states that Ofcom has to have regard to the extent to which its duties can be secured or furthered by effective self-regulation. I hope that the hon. Member for South Cambridgeshire will be reassured by those comments and agree that the amendment is unnecessary. 
 We are lucky to have such a good and successful local radio industry in the United Kingdom, and we want to keep it that way. Local radio stations have nothing to fear from a localness code. Localness is what they are good at, and the code will ensure that they continue to be good at it in a changing world.

John Whittingdale: I have to say that I am somewhat disappointed by the Minister's response. He seemed to recognise some of our arguments, stressing that it will be for Ofcom to decide what to include in the code as to what should be local. However, the fact that the Bill specifies in black and white various provisions to do with premises and employment seems to suggest that Ofcom will take it that those factors are important must be included.
 The Minister quoted, with approbation, Ralph Bernard, but Mr. Bernard said, in the paragraph before the one that Minister read out, that the clause 
''is akin to the regulator setting up a division to make sure that we remember to switch the microphone on when we want to broadcast an announcement.''
 The clause seems far too prescriptive. I am disappointed that while the Minister accepted the thrust of the amendment, which sought co-regulation and the self-regulatory principle, he was unwilling to accept it. Although my hon. Friend the Member for South Cambridgeshire has had to leave us, the Opposition are keen to press the amendment. 
 Question put, That the amendment be made:—
The Committee divided: Ayes 4, Noes 14.

Question accordingly negatived. 
 Clause 302 ordered to stand part of the Bill.

Peter Atkinson: Before we move on to clause 303, I was remiss in not telling Members not present at the Programming Sub-Committee that the effect of its decision is that instead of the Questions on clauses being put at 11.25 am, whether or not they have been debated, those Questions will now be put at 5 pm.
 Clause 303 ordered to stand part of the Bill.

Clause 304 - Conditions relating to competition matters

John Whittingdale: I beg to move amendment No. 618, in
clause 304, page 262, line 28, leave out from 'appropriate' to end of line 29 and insert 
 'to promote the interests of consumers in markets relevant to the provision of licensed services or of connected services, where appropriate by promoting competition.'.

Peter Atkinson: With this it will be convenient to discuss the following:
 Amendment No. 619, in 
clause 304, page 262, line 30, leave out subsection (2).
 Amendment No. 645, in 
clause 305, page 263, line 13, leave out subsection (2) and insert— 
 '(2) OFCOM shall not exercise any of their Broadcasting Act powers in relation to any matter to the extent that such matter is capable of being dealt with under the Competition Act 1998 (c.41).'.
 Amendment No. 649, in 
clause 305, page 263, line 17, leave out subsection (3).
 Amendment No. 624, in 
clause 305, page 263, line 34 after first 'a', insert 'Broadcasting Act'.
 Amendment No. 625, in 
clause 305, page 263, line 35 leave out from 'if' to end of line 41 and insert 
 'and to the extent that, that power is exercised by OFCOM in furtherance of the duty under section 3(1)(a) of this Act.'.
 Amendment No. 650, in 
clause 305, page 263, line 41, at end insert— 
 '(7A) For the purposes of this section, a Broadcasting Act power exercised by OFCOM will be deemed to be exercised for a competition purpose to the extent that such power is exercised pursuant to the fulfilment of OFCOM's duties under one or both of the duties in section 3(1)(a) or 3(1)(c).'.
 Amendment No. 629, in 
clause 306, page 264, leave out lines 24 to 30 and insert 
 'if, and to the extent that, the provision is made in furtherance of the duty under section 3(1)(a)'.

John Whittingdale: It was with a certain degree of depression that I discovered that my hon. Friend the Member for South Cambridgeshire had been successful in his application for a debate on the film industry that would coincide precisely with the debate on clause 304. It is a complicated clause concerned with Ofcom's exercise of competition-related powers. If ever my hon. Friend happens to find himself on ''Mastermind'', I suspect that his specialist subject may be the workings of competition law, in which he is extremely well versed. I, on the other hand, have had to take a crash course because of his absence and I hope that the Committee will forgive me if I rely rather more on my notes than I have in previous debates.
 I shall begin with a few words of introduction on the clause and the amendments, the purpose of which is to draw attention to some serious concerns about the fact that the Bill does not provide adequate safeguards in relation to the economic regulation of broadcasting. We hope that the Minister will clarify the Government's thinking on that aspect of the Bill, and that, if he is unable to support the amendments, he will at least consider whether it is possible to introduce additional or alternative amendments that will address our concerns. 
 The clause provides Ofcom with sector-specific competition powers relating to the broadcasting sector. Those powers will allow Ofcom to include a general fair trading condition in Broadcasting Act licences. It will also be able to exercise concurrent competition powers under the Competition Act 1998. We think that the sector-specific power is superfluous because, unlike its predecessors, the Independent Television Commission and the Radio Authority, Ofcom is given concurrent competition powers. There is potential for misuse, in that Ofcom might 
 attempt to use the sector-specific power instead of its concurrent competition powers, and thus manipulate markets in which no significant market power exists. The provision is unprecedented: to date, no other regulator has sought simultaneously to exercise both sectoral and general competition powers. 
 Clause 305 requires Ofcom to consider whether it would be more appropriate to act under its concurrent competition powers before exercising its powers under the Broadcasting Act 1996 when it is exercising the Broadcasting Act powers for a ''competition purpose''. That term is defined in clause 305(7), which reflects the wording of the general fair trading condition in clause 304. However, the Bill does not require or even encourage Ofcom to use its concurrent competition powers in preference to its sector-specific powers, despite the Government's stated position that concurrent competition powers should take precedence. That leads to considerable uncertainty about which approach Ofcom will take to competition issues in broadcasting. 
 Given that Ofcom will have concurrent competition powers, it is unclear why it requires competition powers under the Broadcasting Act, as well as an obligation under clause 3 to have regard to 
''the desirability of promoting competition in relevant markets''
 when that is considered to be relevant. If the Government included clause 304 because they believe that there are circumstances in which it would not be appropriate for Ofcom to use its concurrent competition powers when dealing with broadcasting matters, they have yet to explain what those circumstances are. It is extremely difficult to foresee a situation in which it would be legitimate for Ofcom to use its competition powers under the Broadcasting Act, but in which its concurrent competition powers were not available to it. 
 It would be inappropriate if clause 304 had been included merely because of the power that is available to the ITC and the Radio Authority. Although both are currently subject to a statutory duty to ensure fair and effective competition, they do not enjoy the concurrent competition powers that Ofcom will be given. Because of that, to discharge the duty to ensure fair and effective competition, the ITC and the Radio Authority need to be able to impose an obligation on the companies that they regulate via their licences. However, Ofcom will be able to apply and enforce the statutory competition regime and will not need to fall back on a general fair trading licence condition, as the ITC and the Radio Authority have done in the past. 
 We should recognise that to date no regulator in the communications sector has sought to rely simultaneously on a general fair trading condition and concurrent competition powers. When Oftel first introduced a fair trading condition into Telecommunications Act 1984 licences in the mid-1990s, it included in that condition a sunset provision that ensured that it ceased to apply when prohibition-based competition legislation came into force. That sunset provision was triggered on 1 March 2000 when the Competition Act 1998 came into force: from that date, the general fair trading condition in licences 
 under the Telecommunications Act 1984 ceased to apply. Oftel took the further step of confirming, in a statement on 1 July 2002, that its approach when faced by behaviour that could contravene both the Competition Act and the sectoral regime would be to use its Competition Act powers and not to rely on the sectoral regime. 
 In the light of that, allowing Ofcom to rely simultaneously on competition powers in the Broadcasting Acts 1990 and 1996 and its concurrent competition powers is unprecedented, disproportionate and contrary to the principles of good regulation. It also creates inequities between the ways in which electronic communications networks and services on the one hand, and the broadcasting sector on the other, are treated. Amendments Nos. 645 and 549 require Ofcom to use its concurrent competition powers in priority over its sector specific powers. Ofcom should not have the discretion to choose which route to take when it makes decisions, which is what the Bill as it stands provides. 
 The Bill is silent on the general question of the economic regulation of broadcasters. Part 3 gives Ofcom overall power to regulate the broadcasting sector via broadcasting licences. Under clause 206(2)(b), Ofcom's function in relation to broadcasting is 
''to regulate . . . in accordance with this Act, the 1990 Act and the 1996 Act . . . television licensable content services that are provided by persons under the jurisdiction of the United Kingdom for the purposes of the Television without Frontiers Directive''.
 Those licences are to be issued pursuant to the Broadcasting Acts 1990 and 1996, which give Ofcom the power to impose licence conditions on licensees and issue directions pursuant to the fulfilment of Ofcom's duties. 
 Although part 3 describes the regulation of content in the television broadcasting sector in detail, it is silent on how Ofcom should undertake the economic regulation of broadcasting, other than under the extremely wide functions given to Ofcom to regulate and licence the broadcasting sector. Ofcom could seek to include whatever conditions it considers appropriate in broadcasting licences. It has considerable scope to regulate broadcasters in ways that are unrelated or only peripherally related to content regulation, which could be outside the scope of Ofcom's concurrent powers and its sectoral competition powers. For example, Ofcom could seek to impose conditions on broadcasting licensees in the nature of economic regulation that is not for a competition purpose, but is pursuant to one of Ofcom's other duties. 
 For example, clause 3(1)(a) imposes on Ofcom a duty to 
''further the interests of consumers''.
 In performing that duty, Ofcom must have regard to the interests of consumers 
''in respect of choice, price, quality of service and value for money.''
 Under clause 3(1)(a) and clause 3(4), Ofcom may seek to determine that packages of television channels should be comprised of particular channels or a particular number of channels all sold at a particular 
 price in ''the interests of consumers''. Directions that Ofcom sought to impose on broadcasting licensees pursuant to the fulfilment of that duty would be in the nature of economic regulation, but would arguably not be pursuant to any of Ofcom's competition powers. 
 Similarly, Ofcom may seek to rely on its duty under clause 3(1)(c): 
''to secure the availability throughout the United Kingdom of a wide range of television and radio services which (taken as a whole) are both of high quality and calculated to appeal to a variety of tastes and interests''.
 Ofcom may seek to use that duty to impose on broadcasters licence conditions or directions regarding channel packaging and pricing, or other types of significant economic regulation that are unrelated, or only indirectly related, to the core matters of content regulation that part 3 of the Bill deals with. 
 I understand that in discussions with industry representatives, officials have advised that Ofcom would not use its licensing powers to undertake economic regulation of the broadcasting sector. The fact that the Bill leaves cable distributors of television services unregulated in these activities shows that they are not intended to be caught—otherwise, significant disparities between the regulation of competitors engaged in the same activities would arise. 
 Ofcom would have no jurisdiction over how cable operators package and price television channels, as the operators do not require part 3 licences to retail third-party channels. Their television activities are thus unregulated by the Bill. However, However, Ofcom could assume jurisdiction over the retail packages of satellite retailers that hold broadcasting licences. Ofcom could seek to regulate the prices of distributors of channels on satellite that happen to hold broadcasting licences, while satellite distributors that retail only the channels of third parties would remain outside the regulatory net as they would not need a part 3 television licensable content service licence for those activities; they could therefore price and package as they pleased. 
 In any event, the intention that Ofcom will not use its licensing powers to undertake economic regulation of that type is not reflected in the Bill, and there are no safeguards against Ofcom using its licensing powers in that way. Such concerns are not unfounded. Under the ITC regime, the regulator relied on its duties to ensure both the availability of a wide range of services and fair and effective competition in order to issue directions regarding the package of channels—the so-called minimum carriage requirement—and the EPG code. 
 Furthermore, the exercise by Ofcom of its powers in relation to the economic regulation of broadcasting under part 3 of the Bill—where matters do not fall to be dealt with under its concurrent competition powers—is not subject to sufficient procedural safeguards. The introduction of and any changes to codes, licence terms or general directions to the broadcasting sector are not governed by a set of tests and procedures for their introduction and modification that is similar to the set of tests and procedures in clauses 43 and 44, which apply to 
 electronic communications networks and services. Similarly, the bill does not provide full rights of appeal to the Competition Appeal Tribunal against Ofcom decisions in such matters. 
 At the moment, the Bill provides full rights of appeal in three circumstances, subject to a number of exceptions—

Peter Atkinson: Order. I do not want to put the hon. Gentleman into any more difficulty, but appeals are covered in the next group of amendments.

John Whittingdale: In actual fact, Mr. Ofcom, amendment No. 650—[Laughter.]

Michael Fabricant: It must be the heavy regulatory touch.

John Whittingdale: As my hon. Friend suggests, Mr. Atkinson, it may be the heavy regulatory touch that caused me to call you Mr. Ofcom. I do apologise.
 I was addressing amendment No. 650, which has been included in the group of amendments for this clause and which deals with procedural safeguards, including rights of appeal. The matter is dealt with in both clauses 304 and 305, and I assure you, Mr. Atkinson, that if I am allowed to consider these matters in the current debate on clause 304, I am less likely to speak at such length when I outline the case in favour of the amendments to clause 305.

Peter Atkinson: The Committee might consider that a fair deal.

John Whittingdale: Let us hope that this sets a precedent for relations between regulators and those whom they seek to regulate.
 The Bill currently provides full rights of appeal in three circumstances: in relation to decisions that are taken under part 2, decisions that are taken under the concurrent competition powers, and decisions that are taken when Ofcom is exercising its powers under the Broadcasting Act 1990 
''for a competition purpose.''
 I have already mentioned that Ofcom could try to take decisions and impose licence conditions and directions that amount to economic regulation in connection with a number of its primary duties that it has not designated as being 
''for a competition purpose'',
 for which the only recourse under the provisions of the Bill as it stands is to go to judicial review. Thus, broadcasters will be denied rights that are available to, for example, telecommunications operators. It is bizarre and inconsistent that in a Bill that is based on convergence, Ofcom's ability to act in relation to electronic communications networks and services is subject to due safeguards and accountability, but that ability is not safeguarded in relation to broadcasting. 
 The amendments and new clauses tabled by my hon. Friend the Member for South Cambridgeshire go a long way towards rectifying those deficiencies. They would remove the unnecessary and redundant fair 
 trading condition in licences, tying conditions relating to competition matters to clause 3(1)(a), which states Ofcom's duty to promote consumer interests in markets that are relevant to the provision of licensed services or of connected services, where that is appropriate, by promoting competition. That would ensure that if Ofcom relied on that duty in exercising its powers under the 1990 Act, there would be a full right of appeal. Other procedural safeguards that are currently lacking would also be put in place: for example, consultation prior to the introduction of codes, licence terms or general conditions, and consultation prior to subsequent changes in its codes and licences. 
 The third amendment in the group, No. 650, goes further than my hon. Friend's amendments. It would ensure that a power exercised by Ofcom pursuant to clause 3(1)(a) and 3(1)(c) would be subject to proper procedural safeguards, including full rights of appeal. It therefore closes a hole in the Bill through which Ofcom might seek to rely on its clause 3(1)(c) duty and take decisions and impose licence conditions and directions. Such a course of action would amount to economic regulation, for which proper safeguards might not be provided and for which the only recourse would be judicial review. There is evidence from the current regulatory regime that the risk of a regulator using such a duty is not theoretical. The ITC has acted under both of its primary duties under the Broadcasting Act 1990—to ensure that there is fair and effective competition and to ensure that a wide range of services are available—to undertake matters of significant economic regulation. 
 I recognise that the Government do not intend to provide for a full independent appeals process on the merits of any decision, licence condition or direction made by Ofcom. I fully accept that the Competition Appeals Tribunal is not well placed to make judgments relating to, for example, taste and decency issues. However, our amendments are not intended to be open ended and they do not allow for such appeals in respect of Ofcom's duties in respect of standards in all television and radio services. The judicial review process will continue to provide the appropriate mechanisms and standards for appeals on matters relating to offensive and harmful material in television and radio services, unfair treatment in programmes, and infringements of privacy. 
 If there are other areas in which the Government think that full independent rights of appeal or proper procedural safeguards should apply, they should identify them, allow a proper debate to take place, and table the appropriate amendments to narrow the scope accordingly. That is standard better regulation practice, as supported by the Government, which requires transparency, accountability, proportionality, consistency and the targeting of cases in which action is needed. The Government are not meeting the standards of better regulation in respect of the power under discussion, because it is not targeted on cases in which action is needed. 
 This is not the first time that we have raised the issue of safeguards and appeals. In the debate on clause 187, I mentioned that its effect would be to 
 introduce full rights of appeal for decisions, directions, approvals and consents made under part 2. We agreed that it would put in place strong and necessary safeguards and I contrasted that with the provisions in part 3. In his response, the Minister for E-Commerce and Competitiveness said that 
''Regulation of content is excluded from the scope of the directives and there is no EC requirement for an appeal on the merits involved. Matters of content regulation are strongly connected to public policy and we believe that it is wrong for courts to have the task of reviewing the merits of relevant public policy as part of an appeal process. The judicial review process provides the appropriate mechanisms and standards for an appeal. When powers in the Broadcasting Acts 1990 and 1996 are used to promote competition rather than regulate content, it is appropriate and consistent with the drafting for there to be a formal appeal to the tribunal. That is the distinction that the Bill makes.''—[Official Report, Standing Committee E, 9 January 2003; c. 403–04.]
 However, it should be clear from what the Minister said and my comments on what he said that the issue is not as simple as that. 
 The fact that proper procedural safeguards and rights of appeal are not contained in EC directives is not sufficient grounds for their exclusion from the Bill. It is a matter of the Government's professed principles of good regulation that they are expanded in part 3, in which an element of economic regulation is involved. Pure matters of content, such as those covered by Ofcom's duty in clause 3(1)(d), are unlikely to give rise to questions of economic regulation that merit a full right of appeal to the Competition Appeals Tribunal. However, we have shown that the Bill leaves Ofcom with the ability to undertake matters of significant economic regulation under part 3 that may be unrelated, or only indirectly related, to content regulation. That might be done on grounds other than its concurrent competition powers or its sectoral powers for a competition purpose. In such cases, there is no right to a full appeal process, even though similar decisions made under part 2—for example, in relation to pricing and packaging of telecommunications services—provide such a right. 
 I hope that, in responding to this lengthy submission, the Minister will use the opportunity to clarify the Government's thinking about those aspects of the Bill and will consider tabling additional or alternative amendments to address the concerns that I have outlined, even if he cannot bring himself to support our amendments. Will he at least give us some assurance on how Ofcom will use both the powers that it inherits under competition legislation, and those that it can exercise under the Broadcasting Acts?

Kim Howells: I have to admit that I share with the hon. Member for South Cambridgeshire a kind of perverse enjoyment of matters relating to competition law and its implications for markets including broadcasting and telecommunications. The hon. Member for Maldon and East Chelmsford should not underrate his ability to give us the gospel according to BSkyB—he did a magnificent job. However, I do not agree with the amendments, and I shall explain why.
 The effect of amendments Nos. 618 and 625 would be to give primacy to Ofcom's duty under clause 3(1)(a) to promote the interests of consumers where 
 appropriate by promoting competition. Amendment No. 650 seeks a similar outcome, but would also add Ofcom's duty under clause 3(1)(c) 
''to secure the availability throughout the United Kingdom of a wide range of television and radio services which (taken as a whole) are both of high quality and calculated to appeal to a variety of tastes and interests.''
 The amendments would widen the scope of the decisions that would be subject to the right of appeal on their merits to the Competition Appeals Tribunal. The effect would be unduly to limit Ofcom's statutory discretion in the application of its general duties under clause 3 and those functions that, rightly, should have a route of appeal to judicial review. 
 Clause 3 sets out an overall duty on Ofcom to further the interests of consumers in relevant markets, where appropriate by promoting competition. As a general duty, together with the other duties contained in clause 3, it applies to all of Ofcom's functions, including those set out in the clauses relating to its Broadcasting Act competition powers. The same is true of Ofcom's general duty to secure the availability of a wide range of television and radio services. Ofcom is required to resolve any conflict between its clause 3 duties in such manner as it thinks fit. 
 We have provided for those of Ofcom's decisions that are made for the purpose of ensuring fair and effective competition to be subject to a right of appeal on the merits to the CAT. Other decisions that Ofcom makes for policy reasons may have an economic effect, but that does not mean that they should be subject to a similar right of appeal. It is important that Ofcom, a specialist broadcasting regulator, should retain its discretion in that respect. We are satisfied that judicial review of those of Ofcom's decisions that do not relate to competition is entirely appropriate. 
 Amendment No. 645 would limit Ofcom's ability to determine the most appropriate route for intervening in a competition matter. The ''where appropriate'' test, in the current wording of clause 305(2), is in line with the concurrent powers of all other regulators in competition matters. That formulation acknowledges that regulators of a range of sectors, not only of communications, are best placed to determine whether to use general competition law or sector-specific competition powers. That is entirely the correct approach. Broadcasters can apply for judicial review if they consider that Ofcom has wrongly used its sector-specific powers when the Competition Act powers would have been the more appropriate route. 
 The hon. Member for Maldon and East Chelmsford raised the specific matter of ensuring parity and equity between platforms. He was right to say that cable packages do not require a licence under part 3, but nor does a packager of satellite channels. However, a cable packager that provided its own channels as well as or instead of simply distributing channels provided by others would need a licence for those channels. In that respect, therefore, cable and satellite are treated in the same way. It depends on the nature of the business and especially on whether the packager provides its own channels. 
 It is true, as the hon. Gentleman said, that no regulator has used both sets of powers simultaneously. 
 There is always a choice of route. He mentioned the Oftel statement of 1 July 2002, which stated: 
''In some cases it may be appropriate to use sectoral powers. However, in the majority of cases that could potentially be caught by the Competition Act, but which do not arise from interconnection disputes, the Director General now expects to investigate, and where appropriate take enforcement action, under the Competition Act rather than under the sectoral regime. The proportion of cases dealt with under the Competition Act will increase.''
 The hon. Gentleman could have quoted that statement. Oftel is not saying that it will not use sectoral powers—on the contrary. It went on to state: 
''Oftel may decide at any stage in an investigation that it is more appropriate to carry out the investigation under the sectoral regime rather than under the Competition Act.''
 It is clear that the regulators should, from time to time, have access to the necessary powers. As I have already outlined, there is good reason for that. 
 Those who argue against clause 304 believe that the Competition Act is sufficient to protect against anti-competitive behaviour in broadcasting. That is a cause of fundamental disagreement. Under the prohibitions in the Competition Act—those prohibitions on which Ofcom would largely have to rely were its sector-specific powers to be removed—intervention would be allowed only if there was an abuse of a dominant position, or if agreements existed that appreciably prevented, restricted or distorted competition. We are concerned about cases in which markets should be opened up to greater competition but where the legal tests required by the Competition Act are not met. That is when the anorak expertise of the hon. Member for South Cambridgeshire becomes important. I shall attempt to explain why. 
 The sector-specific powers contained in the Bill can be used to supplement those contained in the Competition Act. The Competition Act cannot be applied until the regulator has reason to believe that an enterprise has harmed the market by acting anti-competitively, or that the market has been harmed by existing agreements. As such, there are situations in which the use of sector-specific powers may be more effective, especially where advance action or action in a short time frame is required to ensure effective competition. 
 The opponents of that policy want us to leave the broadcasting sector to be determined by the Competition Act, which, I am sure the hon. Member for Maldon and East Chelmsford will agree, has very little broadcasting case law behind it. The Act is still relatively new. Our policy is to carry over the safeguards that the ITC and the Radio Authority have had to guarantee that Ofcom has that same flexibility to ensure fair and effective competition as the other broadcasting regulators had pre-Ofcom. 
 We have made changes to ensure that Ofcom cannot use those powers in a way that unnecessarily burdens industry. The policy's opponents might have lost sight of the fact that the Bill will ensure that Ofcom must not use its sector-specific competition powers where it considers that the more appropriate 
 route would be under the Competition Act. That is important. Any decision that Ofcom makes for a competition purpose will have a route of appeal to the CAT. Moreover, Ofcom must periodically review any of the prohibitions that it issues under its sector-specific powers to ensure that unnecessary burdens on the industry are removed. Given those safeguards, I hope that the hon. Member for Maldon and East Chelmsford will seek leave to withdraw his amendments.

John Whittingdale: I am not sure that the Minister's assurances take us further forward. He says, for example, that the regime applied to cable and satellite operators is the same, because if a cable operator were to provide its own channel, it would be subject to those powers, whereas a satellite operator that did not provide channels would not. That theoretical argument is undoubtedly correct, but the practical effect is that, in the present market, cable operators have to be outside the arrangements and satellite operators do not. The Bill's provisions appear to be discriminatory.
 Although the Bill states that Ofcom should use its Competition Act powers in preference to its Broadcasting Act powers, it is left to Ofcom to decide whether that is the more appropriate way to proceed. That an appeal to the tribunal is available in respect of competition purposes is something, but the Minister appears to concede that Ofcom may use its Broadcasting Act powers for purposes that do not relate to, for example, content regulation, taste and decency, or standards, which come under part 3, but that do relate to economic matters, even though they do not necessarily come under the competition requirements of clause 3(1). 
 I have a feeling that the Minister is confirming my fear that it is at least possible that Ofcom may interpret its general duties to impose conditions using its Broadcasting Act powers, which most people would see as economic regulation rather than content regulation. Even though the Minister has not reassured me, I shall not press for a Division, as I suspect that the subject will be debated again later in our proceedings. We are to debate some procedural safeguards that might help under amendments to clause 305 that stand in the name of my hon. Friend the Member for South Cambridgeshire. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Clause 304 ordered to stand part of the Bill.

Clause 305 - Exercise of Broadcasting Act powers for a competition purpose

John Whittingdale: I beg to move amendment No. 620, in
clause 305, page 263, line 10, leave out 'and'.

Peter Atkinson: With this it will be convenient to discuss the following:
 Amendment No. 621, in 
clause 305, page 263, line 12, at end insert 
 'and— 
 (e) every power of theirs to issue a code of practice or guidance to holders of such a licence.'.
 Amendment No. 622, in 
clause 305, page 263, line 20, at end insert— 
 '(3A) In any case where OFCOM decide to exercise any of their Broadcasting Act powers for a competition purpose, OFCOM shall give written notice to any person affected by that decision, stating that— 
 (a) the exercise of the power in question is to any extent for a competition purpose; and 
 (b) any person so affected may appeal to the Competition Appeals Tribunal against the decision in accordance with this section.'.
 Amendment No. 623, in 
clause 305, page 263, line 28, leave out from 'excludes' to 'to' in line 32 and insert 
 'consideration of whether any breach of subsection (2) has occurred or may occur, and accordingly that matter falls'.
 Amendment No. 626, in 
clause 306, page 264, line 15, leave out 'and'.
 Amendment No. 627, in 
clause 306, page 264, line 17, at end insert 
 '; and 
 (d) every condition imposed by them under or for the purposes of a broadcasting provision.'.
 Amendment No. 628, in 
clause 306, page 264, line 18, leave out 'his' and insert 'their'.
 Amendment No. 630, in 
clause 306, page 264, line 30, at end insert— 
 '(4A) If, and to the extent that, OFCOM determines that a provision subject to periodic review under this section is or may be expected no longer to be necessary— 
 (a) in order to secure fulfilment of their duties under section 3(1)(a); or 
 (b) because the market to which the provision relates is effectively competitive and no licence holder is able to exercise significant market power, as defined under section 74 of this Act, 
 then OFCOM shall be required to revoke or withdraw that provision, or modify it to the extent consistent with its continuing requirement under subsection (4).'.
 New clause 42—Test for setting or modifying conditions or directions— 
'(1) When exercising any of their Broadcasting Act powers for a competition purpose as defined in section 305, OFCOM must not— 
 (a) set a condition or issue a direction; or 
 (b) modify such a condition or direction, 
 unless they are satisfied that the condition or direction or (as the case may be) the modification satisfies the test in subsection (2). 
 (2) That test is that the condition, direction or modification is— 
 (a) objectively justifiable in relation to the services to which it relates; 
 (b) not such as to discriminate unduly against particular persons or against a particular description of persons; 
 (c) proportionate to what it is intended to achieve; and 
 (d) in relation to what it is intended to achieve, transparent.'.
 New clause 43—Procedure for setting, modifying and revoking conditions or directions— 
'(1) In relation to Part 3 of this Act— 
 (a) the way in which conditions or directions are to be set or modified when OFCOM are exercising any of their Broadcasting Act powers for a competition purpose is by 
the publication of a notification setting out the conditions, directions or modifications; and 
 (b) the way in which such a condition or direction is to be revoked is by the publication of a notification stating that the condition or direction is revoked. 
 (2) Before setting conditions or directions, or modifying or revoking a condition or direction so set when OFCOM are exercising any of their Broadcasting Act powers OFCOM must publish a notification— 
 (a) stating that they are proposing to set, modify or revoke the conditions or directions that are specified in the notification; 
 (b) setting out the effect of those conditions, directions, modifications or revocations; 
 (c) giving their reasons for making the proposal; and 
 (d) specifying the period within which representations may be made to OFCOM about their proposal. 
 (3) That period must end no less than one month after the day of publication of the notification. 
 (4) OFCOM may give effect, with or without modifications, to a proposal with respect to which they have published a notification under subsection (2) only if they have considered every representation about the proposal that is made to them within the period specified in the notification. 
 (5) The publication of a notification under this section must be in such manner as appears to OFCOM to be appropriate for bringing the contents of the notification to the attention of such persons as OFCOM consider appropriate.'.
 New clause 44—Setting and publication of guidance and codes— 
'(1) Before setting guidance and codes which includes matters which will have effect to any extent for a competition purpose under a provision of this Part of this Act (other than under sections 291, 294 or 312), of the 1990 Act or of the 1996 Act, OFCOM must publish, in such manner as they think fit, a draft of the proposed guidance or code. 
 (2) After publishing the draft guidance or code, OFCOM must consult every person who holds a relevant licence. 
 (3) Subsections (1) and (2) apply to a proposal by OFCOM to revise any guidance or a code as they apply to a proposal to set such guidance or code. 
 (4) Where OFCOM set guidance or a code, they must publish the guidance or code in such manner as they consider appropriate for bringing it to the attention of the persons who, in their opinion, are likely to be affected by the guidance or code. 
 (5) Where OFCOM revise a guidance or code, they shall similarly publish the guidance or code containing the standards as revised. 
 (6) Where OFCOM publish a guidance or code under subsection (4) or (5), they shall send a copy of it to the Secretary of State. 
 (7) In this section a person who holds a ''relevant licence,'' in relation to draft guidance or a draft code, means— 
 (a) to the extent that the draft guidance or code relates to— 
 (i) television programme services, 
 (ii) the public teletext service, or 
 (iii) an additional television service, 
 a person who holds a licence under any of Part 1 of the 1990 Act (independent television services), section 18 of the 1996 Act (digital television programme services), section 25 of that Act (digital additional television services), or section 214 of this Act; 
 (b) to the extent that the draft guidance or code relates to radio programme services, a person who holds a licence under Part 3 of the 1990 Act (independent radio services), section 60 of the 1996 Act (digital sound performance services) or section 64 of that Act (digital additional services); and 
 (c) the BBC and Welsh Authority.'.

John Whittingdale: I shall not set out at great length the background to the amendments, because they
 cover essentially the same issues as we discussed in our debate on clause 4. Instead, I shall outline the purpose of each amendment, as my hon. Friend the Member for South Cambridgeshire has explained it.
 Amendments Nos. 620 and 621 would ensure that the safeguards in the clause applied not only to the items in subsection (1)(a) to (d) but to codes and guidance. Amendment No. 622 would require the issuing of a notice so that the availability of an appeal is fully transparent to those who might be affected. Amendment No. 623 would narrow the scope of subsection (6) so that the decision whether it was more appropriate to use powers under the Competition Act 1998 would be subject only to judicial review; but if in making such a decision Ofcom was alleged to have acted in contravention of subsection (3) and to have used its Broadcasting Act powers for a competition purpose when it had determined that Competition Act powers would be more appropriate, that, too, could be adjudicated on its merits. Judicial review would be too procedural in that instance, and it is important that there should be an opportunity to examine the merits of the decision. 
 Amendments Nos. 626 and 627 to clause 306 would require conditions applied for a competition purpose to be subject to review. Amendment No. 628 is a minor drafting amendment, which I hope that the Minister will consider acceptable. Amendment No. 630 would amend clause 306 as amended by amendment No. 627. It introduces a request that if, following a review, a provision is held to be not necessary to fulfil the duty to further the interests of consumers through competition where appropriate, that provision should be withdrawn or modified; and, as a separate test, if the market is effectively competitive, Ofcom should liberalise by disapplying the unnecessary provision. That would bring the competition provisions of the broadcasting part of the Bill more into line with the telecoms part, in which an effectively competitive market is not subject to conditions and there is a periodic review. 
 New clause 42 would provide for tests of proportionality, justification, non-discrimination and transparency in the application of competition-related powers. New clause 43 is procedural: it sets out how Ofcom should go about setting or modifying conditions and directives. New clause 44 sets out desirable procedures for the creation of transparent and accountable processes under which Ofcom can establish and publish guidance and codes where a competition purpose is involved. 
 The amendments and new clauses would provide a more complete structure of competition powers and safeguards, which Ofcom could use in relation to the broadcast industry. They build on the arguments that I advanced in relation to clause 304, and I hope that the Minister will consider strengthening the safeguards in the way that we suggest, because there is a widespread view in the industry that that is necessary.

Kim Howells: This may be an historic moment for the Committee, because I want to begin by thanking the hon. Member for South Cambridgeshire for
 amendment No. 628, which I accept. [Hon. Members: ''Hooray!'']
 I shall deal with the other amendments on four fronts. They are important amendments, and I know that the hon. Member for South Cambridgeshire would have argued strongly in favour of them had he been in the Committee. Several of them are designed to ensure that Ofcom carries out its functions according the best regulatory practice. We do not disagree with the principle behind the amendments that Ofcom should adopt appropriately fair and transparent processes for applying its sector-specific broadcasting powers, as for its other powers, but we believe that the Bill contains sufficient provisions to ensure that that is delivered. 
 In general, I believe that Ofcom is perfectly capable of developing and applying best practice in its procedures—indeed, it is under a duty to do so. Clause 3 provides that Ofcom should have regard to those principles that represent best regulatory practice, namely that its regulatory activities should be transparent, accountable, proportionate, consistent and targeted only on cases in which action is needed. In addition, clause 7 requires Ofcom to carry out an assessment of the likely impact of major or significant proposals. It is not necessary to repeat those important principles. 
 Clause 305 provides that Ofcom should not use its sector-specific broadcasting powers—that is, its powers in relation to broadcasting licences under part 3 of the Bill and under the Broadcasting Acts—if it considers that a more appropriate way of proceeding would be through the use of the general competition powers under the Competition Act 1998. Broadcasters are not at risk of double jeopardy. Once Ofcom decides that the more appropriate way of proceeding is under the Competition Act, it cannot then use its sector-specific broadcasting powers in that matter. That is at the heart of the clause. Finally, any decision Ofcom makes for a competition purpose shall have a route of appeal to the Competition Appeal Tribunal. I hope that that answers the points raised by the hon. Member for Maldon and East Chelmsford in moving the amendments.

John Whittingdale: It has taken 19 sittings for me to have an amendment accepted—although it is an amendment that would leave out the word ''his'' and insert the word ''their'' and it was tabled by my hon. Friend the Member for South Cambridgeshire. Even so, I am extremely grateful to the Minister for accepting the major change to the Bill set out in amendment No. 628.
 The remaining amendments would strengthen the safeguards in the Bill. The Minister is right to say that it will be the cause of some disappointment to my hon. Friend that the Government will not accept them. We hope that Ofcom will take account of the Minister's comments when using its powers, and I welcome his remarks; none the less, it would have been better if the Bill had been amended as we suggest. I suspect that we shall return to this whole question later in our proceedings, and on that basis, at this stage, I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Clause 305 ordered to stand part of the Bill.

Clause 306 - Review of powers exercised for competition purposes

Peter Atkinson: After the Minister's dramatic announcement, we must now deal with amendment No. 628.
 Amendment made: No. 628, in 
clause 306, page 264, line 18, leave out 'his' and insert 'their'.—[Mr. Whittingdale.]
 Clause 306, as amended, agreed to.

Clause 307 - OFCOM's standards code

Richard Allan: I beg to move amendment No. 522, in
clause 307, page 264, line 43, after 'are', insert 'appropriately'.

Peter Atkinson: With this it will be convenient to discuss amendment No. 589, in
clause 307, page 264, line 43, at end insert 
 'from material likely to cause harm or disturbance'.

Richard Allan: Amendment No. 522 stands in my name and that of my hon. Friend the Member for North Devon (Nick Harvey). We want to tease out an explanation of how the Government expect the standards code to work. In particular, we want to examine the protection of persons under the age of 18. As a way of ascertaining what is intended, the amendment proposes to insert the word ''appropriately''.
 It is worth considering the concern expressed to us that some concepts of a code might fail to recognise different degrees of acceptable content according to age, and might result in attempts to introduce a system of absolute rule for those under or over 18. The reality, as our system of film classification acknowledged, is that different types of content are appropriate for different ages. 
 We recognise that certain things are appropriate for teenagers: although they are under 18, they are old enough to watch some things that may not be appropriate to very young children. The way in which we have historically tried to respect children's right not to be exposed to inappropriate content is by means of the 9 o'clock watershed. Certain programmes that are not so extreme that they need to be shown after the watershed should nevertheless be shown at an appropriate time in the evening so that very young children do not watch them. 
 How does the Minister envisage the standards code working? Can he assure us that when schedulers are assembling programming, they will have a degree of flexibility that enables them to take a sensible approach to what is appropriate at 7 o'clock, 8 o'clock or 9 o'clock, rather than their having to treat programmes as either post-9 o'clock or pre-9 o'clock material? The latter approach would 
 devalue the schedule and would not reflect audiences' wishes.

John Greenway: Amendment No. 589 is similar in purpose to amendment No. 522, moved by the hon. Member for Sheffield, Hallam (Mr. Allan). This group of amendments is the first of several relating to Ofcom's standards code. I am sure that the Minister will agree that the clause is crucial, so it is important that we get it right.
 It strikes the Opposition that a fundamental specificity is lacking from subsection (2)(a), which sets out the first of various objectives for Ofcom. Only half of the objective is set out—any definition of what persons under the age of 18 are to be protected from is left out. Paragraph (b) specifies that ensuring that 
''material likely to encourage or to incite the commission of crime . . . is not included in television and radio services''
 is an objective of the code. That is much clearer, as are the other objectives set out in subsection (2). 
 We want to tease out, as the hon. Member for Sheffield, Hallam said, the precise purpose of subsection (2)(a). I take the view that the 9 o'clock watershed is not a panacea, so I hope that the Minister's answer will not be simply that Ofcom's objective and duties will be satisfied if the 9 o'clock watershed is observed—which presupposes the existence of material to be broadcast after 9 o'clock that, were it broadcast before 9 o'clock, would be harmful or likely to disturb young people. 
 My more general point is that the Committee should understand clearly the purpose of the provision and that Ofcom should hold an accurate view of its duty. The wording that we have suggested might not be entirely to the Minister's liking—he might like to think about it. However, I am concerned about the prospect of a television or radio service broadcasting material that harms, or disturbs, or even traumatises a young person. Although the objective relates to persons under the age of 18, that might mean children aged six, seven or eight, who in many homes these days seem to have the opportunity to watch or listen to almost anything. 
 We want to help the Minister to establish the purpose of the provision, which I am sure all members of the Committee regard as a vital matter.

John Whittingdale: The clause is perhaps one of the most hotly contested and controversial in the Bill. Many people feel very strongly about it. The purpose of our amendment, as my hon. Friend the Member for Ryedale (Mr. Greenway) has explained, is to get the Minister to say more about how he envisages Ofcom's role in enforcing standards and dealing with questions of content that some people might find offensive and others might view as harmful. There has been much discussion of that issue over the years, as well as recently.
 Society's view of what is acceptable has changed in the past 10 or 15 years. We need only consult previous debates on the issue. The Video Recordings Act 1984 was one of the first measures to attempt to deal with content that, at the time, was perceived to be wholly unacceptable. In particular, I remember that acres of 
 newsprint were devoted to two films—''I Spit On Your Grave'' and ''Driller Killer''. Both were felt to be so far beyond acceptable boundaries that legislation was required to ensure that they were banned. However, I found ''I Spit On Your Grave'' in WHSmith about two weeks ago. It is now classified with an 18 certificate and is freely available to all those who want to buy it. That is an indication that standards have changed. I have not seen it, but I am told that it is a very poor film. One of the dangers that we should recognise is that branding things as wholly unacceptable or offensive acts upon some people as an advertisement, prompting them to seek out those things. Sometimes it is more effective to say that a film is a load of rubbish that should be ignored. 
 Other films that are much more serious contributions to cinema have provoked equally fierce controversy. For a long time, it was not possible to obtain ''The Exorcist'' on video because it was felt to have a potentially very harmful effect, especially on young people. Although it was considered acceptable for such a film to be released in the cinema, it was not acceptable for it to be released on video. However, it has now been released on video, and although I think that it has never been screened on television, it is only a matter of time. I do not object to that, because ''The Exorcist'' is a serious film with some merit, but the development still shows a change in standards. 
 A recent ruling by the British Board of Film Classification is also relevant. Although the Bill does not deal with the cinema exhibition of films, every film shown in the cinema will turn up on television sooner or later, so what the BBFC decides about the regulation of films is bound to have a major influence on Ofcom and those responsible for deciding which warnings to attach to a film when it appears on television. The BBFC's recent decision to remove the 12 rating and replace it with a 12A rating made my life as the parent of a boy of nine who was desperate to see ''Spiderman'' much easier. I have subsequently taken my son to four or five 12A films, including the new ''Lord of the Rings'' film, ''Die Another Day'' and, of course, ''Spiderman''. It is a step forward by the BBFC to say that parents are capable of dealing with such questions.

Richard Allan: Following the hon. Gentleman's train of thought, which was similar to mine about there being gradations of acceptability, has he noticed that continental television uses a similar form of classification? Many continental television channels display symbols in the corner of the screen to indicate a 12, 15 or 18 rating. Does he find that idea attractive?

John Whittingdale: That is an interesting idea, which touches on the important issue of provision of information. Returning to the BBFC decision, it is up to parents to decide whether their children can see a 12A film, because the children cannot get into the cinema unless an adult accompanies them. However television is much harder to deal with, because it is not possible to enforce age limits for viewing in the way that a cinema can do.

Chris Bryant: I accept half of the hon. Gentleman's argument. However, before it goes out on television, every film goes through a wholly separate process of review by the organisation broadcasting it and by Ofcom. Often in that process, large chunks of films are deleted. I presume that he expects that practice to continue.

John Whittingdale: The hon. Gentleman is right. It is appropriate to apply a more rigorous approach to that which is shown on television—not just films; they are an easy example—than to that which is shown in cinemas. The same applies to videos, which carry the additional danger that they can be watched repeatedly, or certain scenes watched time and again, to more damaging effect. That was considered by the BBFC when it took on responsibility for the categorisation of videos.
 It is easy to talk about the most extreme examples in terms of sexual content or violent content. However, I remember a discussion that I had with the late James Ferman, for whom I had a great regard. He was a liberal-minded man who pushed the boundaries in a sensible way, even though he occasionally attracted hostile comment from the Daily Mail. It was with sadness that I read of his death a few weeks ago. 
 One of Ferman's most controversial decisions was about ''Indiana Jones and the Temple of Doom'', which contains a scene in which the high priest tears out the heart of a sacrificial victim. He was concerned about the effect that the graphic portrayal of that event might have on a very young mind. He told me that he had a furious argument with Stephen Spielberg about it. Spielberg argued strongly that the scene was an important part of the film and that it should stay in, but Ferman's reply was, ''No. You will only get a PG certificate if you remove it,'' so Spielberg had had to take it out. Later, he came back to Ferman and said, ''You were right.'' 
 The protection of children is much more important than the general question of the protection of society as a whole. That is why our amendment, which is to some extent a probing amendment, focuses on the role of Ofcom in such matters, and on the protection of those under 18. In the past few weeks, the issue has obviously become far more controversial. As society has accepted scenes of sexual or violent content that would not have been permissible five, 10 or 15 years ago, some of those who are involved in the criminal justice system have expressed concern. I draw attention to the remarks of Lord Warner, the chairman of the Youth Justice Board, who some two weeks ago said: 
''It's very hard to escape the concern that violent videos, violent films, violent music, violent games do influence some of the more impressionable minds . . . I think there's a case for reviewing whether we should regulate more rigorously. There's certainly a coarsening of attitudes.''
 Lord Warner is responsible for the Government's policy on youth crime, which is now a matter of huge concern. At the very least, we should take such warnings seriously. 
 The Minister himself has also expressed views about the issue. Given that he has commented already, I think that the Committee would welcome his saying a little more about how he thinks Ofcom will operate in that context. A few weeks ago, the Minister said: 
''I watch my kids constantly playing blood-spattered video games. I don't think a child is going to turn out to be a killer or more violent as a consequence of playing those games . . . But it's the acceptance of that heartlessness that is at the centre of all those kinds of games''.
 I have a lot of sympathy with the Minister on that issue, because he and I both have the difficult task—far harder than anything we ever do in this place—of bringing up young children. The problem is peer pressure: one says that a film on television or a game is rated 15, and they say, ''Well, all my friends watch it. Why should I be deprived?'' Sometimes I have cracked. I draw the line at 18, but, for 15, the choice is up to parents. 
 However, I worry about the long-term effects, and think that we should pause in our consideration of the Bill, because the issue is hugely important to many people, who are looking for some protection. I worked for Margaret Thatcher when the Broadcasting Standards Council was created to deal with that concern. Although Mary Whitehouse got a lot of brickbats, she fought a long campaign on the issue. In response to some of the concerns that she raised, the BSC was eventually established. I do not agree with a lot of what Mary Whitehouse said, but there is no doubt that a large number of people in the country are concerned, and have become increasingly so in the last few years. Those people will look to Ofcom to enforce standards. 
 I hope that Ofcom will adopt the same relatively liberal approach that the BSC adopted. I remember going with a delegation from the House to the BSC to see a demonstration of its work, in which we were shown a number of scenes that it had decided to cut. I was impressed by the debate that was had before taking a decision. It is very easy to cut something, but often harder to decide not to cut it. However, the BSC set out to protect the artistic integrity of the product, and cut only when it felt that that was absolutely necessary. 
 Although I do not always agree with the concerns raised, I think that organisations such as Mediawatch do a service in drawing our attention to concerns about the way in which more and more violent content is creeping on to our television screens. I think that the watershed is still a valuable concept. However, as technology improves and as the ability to schedule a time of the viewer's choosing rather than the programme maker's choosing increases, the watershed may become less important, and we need to look to other means. 
 I touched on the subject briefly earlier in our consideration of the Bill when we debated media literacy, because technological solutions or other devices can help protect children from harmful content. For instance, digital reception can require a code to be entered if material rated for over-18s is being shown, and I have my digital receiver programmer set so that before any classified material 
 is shown that is broadcast as being suitable for 18 year olds, a code has to be entered. That works well with children of seven or eight, but for children older than 10 the system will begin to break down. However, that sort of safeguard is an improvement, and technology may allow other safeguards. We need to educate parents about the fact that that facility is available. 
 At the end of the day, however, we must be concerned about what goes out on television. Mediawatch conducted a survey of films shown on terrestrial television in 2001, and it added up the number of scenes of violence, those with graphic sexual content and so on. The 200 films that it analysed included 987 scenes showing the use of firearms, 667 showing violent assault, 94 showing incidents of fire-raising and causing explosions, and 318 showing incidents that involved the use of knives. I realise that many of those programmes might be considered to be admirable works of art and that such instances might be considered to be an integral part of the plot. Indeed, in my view the list of films included some good films. For instance, ''Reservoir Dogs'' is an extremely violent film, but I think it is good for adults. Another is ''Dead Calm''.

Richard Allan: I am interested in teasing out the hon. Gentleman's views. He talks of violence. I, too, find the depiction of casual violence on television disturbing. Does he distinguish between sex and nudity and violence, on which one can take differing moral views? Does he share my concern that we in this country worry excessively about sex and nudity but are too relaxed about violence? Many of the movies on in the early evening show plenty of casual deaths: we do not control that aspect sufficiently.

John Whittingdale: I think that I agree with the hon. Gentleman, particularly with the concern now being expressed about the effect on impressionable minds of graphic violence on television. Admittedly, only a small number are affected, but it could lead to criminal activity. The hon. Gentleman is right that violence is the most serious concern.
 Although I have been talking about films, the Minister mentioned a television programme that he was particularly concerned about called ''Serious and Organised''. I watched it the other night because the Minister had mentioned it; it is a fairly typical commercial cops-and-robbers programme, but the Minister was right to say that it has a fairly high level of violence. It goes out just after 9 pm, but it is the gratuitous nature of some of the violent scenes that gives rise to most concern. 
 I have no problem with violent scenes that are clearly an important and integral part of the programme, but violence often seems to be thrown in for no good reason—other than the gratification of those who like that kind of thing—but there is a growing sense that we may have gone too far. I have always said to those who argue that there is too much violence or sex on television that the most effective censor is the off button. Indeed, switching channels or turning off the television is more effective than anything that Ofcom could do. In general, I am extremely reluctant to see more censorship, because I do not like censorship, as a matter of principle.

Michael Fabricant: I am listening to my hon. Friend with considerable interest. Does he not agree that Ofcom could provide a really valuable role in providing as much information as possible to viewers about the contents of a programme before it is transmitted? It is too easy to allow children to watch programmes that may be damaging or to prevent them from watching films, such as ''Trainspotting'', which raise important moral issues.

John Whittingdale: I agree with my hon. Friend. ''Trainspotting'' is a horrific film, but it is difficult to claim that it celebrates violence or that it glorifies drug taking, as some have sought to argue. Anyone who watches that film would be put off taking drugs for life. My hon. Friend's point is that the provision of information is the most important contribution that can be made, in that it empowers parents to take decisions about what is appropriate. Some sort of symbol, either before the programme or even on the screen throughout, might be a way of alerting viewers to a programme's contents, so that they do not unwittingly stumble across something that they find offensive. That would also inform parents, so that they could form a judgment about the programme. Most people would support such a measure, which would be relatively uncontroversial.

Brian White: There is a danger of repeating the mistake made in the 1980s, when Channel 4 displayed a symbol before certain films. That only encouraged some people to come back from the pub to watch those films precisely because they were controversial, which defeated the objective for which the hon. Gentleman is arguing.

John Whittingdale: As I said earlier, there is a danger that one will advertise the contents of a programme to people who go out of their way to watch that sort of film. That would need to be considered, and I hope that Ofcom will carry out research into that. Opinion is divided. Ofcom's decisions must reflect what is currently acceptable in society. The BSC has carried out a lot of work in that area. They commission regular studies of what people feel strongly about or find offensive, whether that is bad language, sex and nudity or violence. As I have sought to indicate, society's attitudes to such things change fairly quickly, so it is important that Ofcom should continue to research public opinion. Given some of the concerns that have been expressed in recent weeks, often after especially horrific incidents, there is considerable public concern about the issue. This is an opportunity for the Minister to set out his view about the extent to which Ofcom should intervene in this area.

Chris Bryant: Several hon. Members have emphasised the significance of the clause. No one would disagree that how we regulate or censor the broadcast media is quintessential to the role that politicians should have, at arm's length, in the regulation of broadcasting. Few Members would not deprecate the culture of violence and aggression that is often perpetuated on television, in films and even on the radio. I sometimes wonder whether we need to take a longer look at the issue, rather than just looking at the situation today.
 I went to the ''Aztecs'' exhibition two weeks ago, which was the most violent exhibition that I had ever seen. The portrayal of the sacrificial victim who has been flayed seems quite a pleasant image until one realises what it represents. There may be a degree of violence and aggression in every culture that we need to understand. It is difficult to know whether it is a question of chicken and egg.

Richard Allan: The hon. Gentleman makes a valid point that the way in which we judge violence depends on the context. Whether it is an exhibition on the Aztecs or a historical television programme, a news clip or a piece of drama about them, there is an important difference—one is gratuitous, the others are informative.

Chris Bryant: Indeed. When I lived in Peru in 1986, there was a news story about a man who had butchered six people. He turned out to be a police psychiatrist. The way in which the news media reported that story was far more gratuitously violent than any film I had seen in my life. They almost gloried in the gore. There was a debate in Peru, and in most of Latin American society, on how that kind of story should be portrayed. The assumption is that for the broadcasters not to show the whole truth—with all of its gore—would be some form of dictatorial censorship. Others were saying that if we glory in this, surely we are creating a culture in which violence is loved and valued.
 That said, I do not think I would want to live in Midsomer, which seems to be the most violent place in the world. It is a small village, but there appears to be no one left standing. I do not know what constituency it is, but crime statistics must have gone through the roof. They all live in very nice houses, however. How many vicars are there in Midsomer? The vicars of Midsomer have been through nearly every sin in the book, and several that are not in it. 
 Several hon. Members have referred to the fact that taste and decency standards change rapidly. In the past 10 or 15 years, we have seen a more rapid change in taste and decency standards than in the past 100 years. I remember watching ''Men Behaving Badly'' on Christmas day or Boxing day a few years ago with some elderly in-laws. I was laughing my face off inside, but I was desperately hoping that the elderly relatives who were of a more conservative bent than myself would not understand the jokes. That would have been terribly embarrassing. There was a horrible moment when somebody said, ''Could somebody just explain that?''. I remember that that episode attracted quite a lot of criticism. Many people were offended. The timing was critical—it was shown at a time when many families would be watching TV together. The level of offence created was significantly higher than had the episode been shown at 8 o'clock or 9 o'clock on a normal weekday. 
 I remember too that there were practically no complaints when ''Queer as Folk'' was first screened in the UK. What the programme was about and whom it was for had been extremely well signposted in advance. Moreover, as the programme started it was announced 
 that there would be disturbing scenes from the outset, which, of course, makes everybody stay up to see what will happen at the beginning. 
 ''Tales of the City'', which was shown on Channel 4 four years prior to that, received remarkably few complaints in the UK. However, the level of protest in the United States at the programme was so great that people did not want to commission a second series. That distressed many people in the UK who had enjoyed the first one. Therefore I am pleased to see a broadly liberal approach as long as we make sure that timing and scheduling issues are well noted and that there is good signposting. This also applies to advertising. I wish there were a way that we could ensure that advertisements were not broadcast at a louder volume than the programme they follow. When you are gently somnolent in front of the television, the advertisements will frighten you out of the room to make tea. 
 The clause is sufficiently well drafted to deliver all those outcomes. In particular, it will allow Ofcom the versatility to change over time. The hon. Member for Maldon and East Chelmsford refers to the work of the BSC, and I hope that Ofcom will adopt much of its modus operandi. The serious debate and intellectual rigour that the BSC has brought to news programming, films, comedy and satire have been very impressive and have made most Britons feel that the broadcasting ecology in Britain is not too far beyond the kind of world that they would like to see on television. I have a tiny question for the Minister on religious broadcasting. Clause 307(2)(e) states: 
''that the proper degree of responsibility is exercised with respect to the content of programmes which are religious programmes''

Peter Atkinson: Order. The hon. Gentleman is moving on to religious broadcasting, which we will come to later; we are discussing children now.

Chris Bryant: I shall therefore stop on that point.

Kim Howells: I thank members of the Committee for an interesting debate. When the hon. Member for Maldon and East Chelmsford was citing some of the movies that he has seen, I was trying to think of when I sensed a change in what was acceptable in film portrayal of in-your-face violence. I have always been a movie buff, and I sensed that it was in ''The Wild Bunch'' by Sam Peckinpah at the end of the 1960s that attitudes started to change. I remember the impact that ''Straw Dogs'' had with its violence and explicit rape. It is a very difficult question. As a kid I was brought up—like others in the Committee who are almost as old as I am—on cowboy films and reruns of Jimmy Cagney movies. There can be few scenes more violent than Jimmy Cagney standing on top of a gas tank telling his mother that he was on top of the world before blowing himself to pieces. We watched a great many war movies as well. I had a fascinating discussion on Saturday about ''The Dambusters'' and its portrayal of what happened; the fact that 30,000 Ukrainian slave labourers died was conveniently ignored. The figure might have been 3,000; it was a lot of people anyway.

Andrew Robathan: Give or take 27,000.

Kim Howells: Exactly. I remember what ''The Dambusters'' looked like and the incredibly powerful music. It was a great post-war move that put the heroism back into an experience that people were trying to put behind them.

Michael Fabricant: Does the Minister not agree that films such as ''Saving Private Ryan'' and ''Stalingrad'', which attempted to show the realities of war more vividly, have also served a purpose?

Kim Howells: Yes. I was about to say that. I find it difficult to understand where—or whether—a line should be drawn. The hon. Member for Sheffield, Hallam pointed out that successive Governments have attempted to do that by endorsing the nine o'clock watershed, but even that has moved around. The first time that I saw ''Saving Private Ryan'', I came out of the cinema in a state of shock, wanting my kids to see it so that they would understand that we should never allow such a situation to happen; we have a duty to ensure that young boys are not blown to pieces. Then, I started to think that it was a bit obscene—there was a kind of glorying in the reality. That brings us back to the form and content argument. As my hon. Friend the Member for Rhondda said, go and take a look at the ''Aztecs'' exhibition. I came out of that thinking that the Spanish had done us all a big favour; it must have been the cruellest regime ever. However, it does not compare with the Nazis. Those are difficult arguments.
 The hon. Member for Maldon and East Chelmsford talked about the sterling work that has been done by the British Board of Film Classification. I agree. My hon. Friend the Member for Rhondda listed some of its virtues. When I went there, having seen the huge lists of the masses of films, television programmes and advertisements that the censors have to watch, I said rather flippantly that when it came to the identical porno movies, it must be great to have a fast-forward button on the remote control. They did not laugh. They looked very seriously at me and said that they did not fast forward anything; every frame was important. It is a matter of freedom of expression and the liberty of individuals to access and watch the images that they want to see. That is a central issue. I do not believe in censorship but, by God, I am very worried about the pornography and violence that is around and I am glad that the hon. Member for Maldon and East Chelmsford quoted Lord Warner. I realised when he did so that I have been misquoting him, because he mentioned the ''coarsening of attitudes'', whereas I had been talking about the coarsening of our sensibilities. The issue is wider than just attitudes, it is about sensibilities and about what we expect. 
 I suspect that the difference between the gangster movies that starred Jimmy Cagney and ''The Wild Bunch'' and what came after it is that formerly an enormous amount was left to the imagination. We leave very little to the imagination now, and exploit the sense of prurience or inquiry that is in all of us to know what the inside of a human body looks like. People are making a lot of money out of live so-called art shows, and from Channel 4 television programmes of those autopsies.

Michael Fabricant: Was not the film ''Sleepers'' far more worrying in imagining what happened in a homosexual rave in a boys' home in upstate New York than it would have been had it vividly shown it?

Kim Howells: I agree—although I have not seen ''Sleepers''—because I suspect that the films that have remained with me for the longest have been those that disturbed me or extended my imagination and made me think about such things.

Chris Bryant: My hon. Friend advances an interesting argument. It takes us to the edge of how the Greeks thought about depicting violence—it all happened off stage, which could make it seem far more violent. Sometimes the BBC faces difficult moments. For instance, possibly the most violent piece of literature in Britain is ''Titus Andronicus'', in which a character has his children served to him in a pie. The BBC had to decide at what time of day to show it.

Kim Howells: Yes, and I can think of many others—for instance, the fairy tales of the Grimm brothers are pretty grim, yet most of us have read those stories to young children and seen for ourselves the attraction that they have. I would be the last person to say that we should not read those stories or try to portray such things differently. It is a difficult problem, but we must not hide it away. It must be publicly debated.
 It has never in any century been easy for any Government or regime to lay down the law on censorship and to say what we should and should not watch. God forbid that politicians should meddle in the subject, but it should be debated none the less. It should not lie in the hands of a tiny elite, whether a self-styled creative elite, or radio philosophers, or—heaven forbid—newspaper columnists, to decide what is and what is not good for us.

Andrew Robathan: I have been listening to the Minister's thoughtful contribution, but is it not up to politicians to stand back and—as he did with his children's blood-spattered videos, to which my hon. Friend the Member for Maldon and East Chelmsford referred—make the connection between what is now being explicitly portrayed on television and in film and the behaviour of young people, particularly on the streets?

Kim Howells: Certainly we should discuss it. What worries me about the way events have moved in recent years is that we do not talk enough about the problem. It seems that it is not hip to talk about it—that it is a generational thing, and suits should not determine what young children watch. The hon. Member for Maldon and East Chelmsford reminded us that there are ways to stop some of the material being seen, especially by very young children, but I have to tell him that my children, who are now teenagers, put locks on the computer to stop me seeing what they watch, because I occasionally stumble on some of their programmes.
 The purpose of the amendments is clear: that Ofcom's codes should expressly provide for the protection of children and young people. That is an important responsibility—indeed, it is one of the most 
 important placed on the regulator—and it goes without saying that the protection provided must be appropriate. Although amendment No. 522 was properly tabled by the hon. Member for Sheffield, Hallam, it calls into question other provisions in the Bill under which Ofcom could be expected to act appropriately without express provision to that effect. Furthermore, I am not sure what ''appropriately'' would add to the list of considerations to which Ofcom must have regard under subsection (4). I hope that hon. Members will remember that subsection. 
 Amendment No. 589 addresses the important question of what those under 18 are to be protected from. We considered that question long and hard, and I have a great deal of sympathy with the amendment. However, we concluded that in the context of Ofcom's responsibilities for standards in the broadcast media, it would not be difficult for Ofcom to answer that general question. 
 Once one starts to try to identify a comprehensive list, no matter how long it becomes, the risk remains that it will still omit certain mischiefs—for instance, some things to which children and young people should not be exposed would not necessarily pass the test of provable harm or disturbance. Indeed, is it necessarily harmful that children are bamboozled and their natural credulity exploited? I do not think that all such mischiefs would necessarily meet the test expressed in the amendment. 
 The detailed interpretation of the objective should be left to Ofcom, as that is the more secure route to achieving the policy objective. However, I agree entirely with hon. Members who contributed to the debate that we need an ongoing public dialogue about such questions.

Richard Allan: I am grateful to the Minister for his response. I do not entirely agree about the Spanish doing the Aztecs a favour. We brought in a raft of diseases that killed millions, but the Aztecs repaid us with syphilis, so there was some equity—[Interruption.] Not us personally, but Europeans.
 Some important points have been made about where the BSC has been and where Ofcom needs to be. The answer is somewhere in the middle, although that is a curious position. Some constituents have expressed their concerns about material that is inappropriate for children, whereas other people want a more liberal regime. It is right that Ofcom should aim to represent the mean, although that is a difficult position for Ofcom to take up because it will be open to criticism from everyone. 
 It is essential to provide information to parents. My general view is that parents, not the state, should decide what children watch. My hon. Friend the Member for North Devon has reminded me that the graphic used to show the category of a programme is called a dog—a digital onscreen graphic. Dogs have an important role to play in many countries.

Kim Howells: I forgot to comment on that. The hon. Member for Maldon and East Chelmsford acknowledged that we should think about the idea, which I endorse, with one proviso. I find extraneous images on the screen intensely irritating. If one is
 watching a great movie—Sam Peckinpah's ''Cross of Iron'' is a great movie, although I did not much like ''The Wild Bunch'' and hated ''Straw Dogs'', both of which Peckinpah also directed—a symbol on the screen gets in the way.

Richard Allan: I sympathise with the Minister because I, too, find it distracting. The general point about providing information is helpful, however. Sky should be congratulated on the fact that its electronic programming guide includes much classification information.
 Violence figured largely in the debate. I have been turning off James Bond-type films recently. I think it has something to do with the juxtaposition of such films with news articles about the potential war. It has become offensive to watch a film that contains casual violence—it has stopped being funny. Context is important. I accept that violence is not always gratuitous when it is used in movies—indeed, it can be an essential part of a movie or television programme—and that it can be gratuitous in a news context. 
 The Minister said that the word ''appropriate'' should not be used in the provision because it would then have to be used everywhere in the Bill, but that it is implied. We shall think about that, although there is still a need to define the clause's provisions better, because, as the Conservative spokesman said, we need to know what we are protecting our children from. There is another side to that argument, which is about protecting them from blandness. It is possible to make television so sanitised that it becomes completely pointless and everyone will buy videos. However, on this occasion, I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

John Greenway: I beg to move amendment No. 205, in
clause 307, page 265, line 14, leave out 'unsuitable' and insert 'misleading or offensive'.

Peter Atkinson: With this it will be convenient to discuss amendment No. 206, in
clause 307, page 265, line 16, leave out 'unsuitable' and insert 'misleading or offensive'.
 We have had a wide and interesting debate on the first group of amendments, but we must bear in mind the relevance of our debate to the amendments. Amendments Nos. 205 and 206, which relate to advertising, are fairly narrow.

John Greenway: I was about to say that after the programmes, the films and the videos, we now have a short advertising break.

Chris Bryant: Sponsored by whom?

John Greenway: I think that this one is sponsored by the Advertising Association.
 The amendments would remove the word ''unsuitable'' from the definition of advertising in television and radio services that is to be prohibited and replace it with ''misleading or offensive''. It has been suggested to us that ''unsuitable'' is an insufficiently precise word for the regulation of radio 
 and television advertising. It is unclear and has no basis in law, unlike ''misleading'', which does. There is also the danger that ''unsuitable'' will be all-embracing. The amendments confer the benefit of clarity and regulatory certainty: one knows what they mean. The definition of ''misleading'' is derived from the Control of Misleading Advertisements Regulations 1988, which implemented the Council directive on misleading advertisements. 
 The amendments also reflect the principles of current advertising codes. The rules in the Independent Television Commission and Radio Authority codes on advertising and sponsorship are generally derived from an intention to prevent misleading, offensive or harmful advertising, although we have not included ''harmful'' in our proposed definition. If the amendments appeal to the Minister, he might want to come back with his own that include that word. Those principles do not seem so far to have hindered the regulator's power to regulate advertising of various advertised product categories and there is no reason why there should be a problem with product categories that cannot be advertised at the moment, but for which advertising might be possible in future. I hope that my argument is clear. To summarise, why is a definition being included in Ofcom's standards code that is different to the one that the industry generally is used to and those who advertise are familiar with? 
 I shall resist the temptation to respond to the comment from the hon. Member for Sheffield, Hallam about blandness by suggesting that the adverts are often the best part of any hour of programming that one watches on ITV. My particular favourite—I cannot remember the product, but I shall get it next time, as I am sure I shall see the advertisement again—is the one in which a couple are in their living room, she says, ''Will you let the dog out?'' and the dog is seen jumping up at the window. Then one sees from outside that they are on the fourth floor of a block of flats. If hon. Members have not seen it, I assure them that it is very funny.

Kim Howells: The amendments would narrow two of Ofcom's standards objectives. As currently drafted, those objectives provide an obligation on Ofcom to prevent unsuitable advertising in television and radio services and unsuitable sponsorship of television and radio services. They are aimed at maintaining the current scope of protection. The Broadcasting Act 1990 currently gives the ITC wide-ranging powers to deal with advertising and sponsorship content, and we would not want to introduce anything in the Bill that would limit that unnecessarily. There is a danger that narrowing the objectives to prevent only the inclusion of advertising or sponsorship considered to be misleading or offensive could skew the operation of the relevant EC directive. I shall try to explain to the hon. Member for Ryedale why that is.
 Articles 10 to 20 of the television without frontiers directive require the application of certain standards restricting the content of advertising and sponsorship. Some of the standards that that directive imposes would fall outside simply restricting advertising or sponsorship that was defined as misleading or 
 offensive. For example, there is a requirement to prohibit TV advertising of tobacco products and a related prohibition of sponsorship of TV programmes by someone whose principal activity is the manufacturing or sale of cigarettes or other tobacco products. Such advertising would be unsuitable, for no other reason than that it would be incompatible with the directive and must therefore be prohibited under Ofcom's code. That would be consistent with Ofcom's requirement under clause 307 to take account of international obligations when setting standards under the code. 
 I am sure that the hon. Member for Ryedale will agree with me that, regardless of the directive's requirements, tobacco is a good example of a product that we do not ant to advertise. If one narrows the objective to exclude adverts that are misleading or offensive, how do we protect against advertising products that, like tobacco, are harmful to health? They would not be misleading or offensive, but they would be harmful to health.

John Greenway: Would they not be banned by other legislation?

Kim Howells: Not that I know of. However, if, between now and the end of the sitting, the hon. Gentleman can tell me that other legislation bans them, I shall acknowledge that.
 ''Unsuitable'' means anything that is undesirable can be excluded. Why narrow the provision? We want to ensure that we have wide powers to ban all undesirable products.

Simon Thomas: I am a little concerned by what the Minister says. I shall give an example of a product that was deemed ''unsuitable'' for advertising until fairly recently, yet is essential for 51 per cent. of the population. I am, of course, referring to tampons. Surely that shows why we must be careful not to give Ofcom too many powers to define ''unsuitable'', lest we rule out products that are perfectly acceptable and necessary.

Kim Howells: The hon. Gentleman makes a valuable point—we do have to be careful. On the other hand, he will acknowledge that if we narrow the wording too far, we start to exclude from the provisions services and products such as tobacco, which, in my view, poses a threat to people of all ages, especially young people. There are other areas of advertising in which the test of advertising suitability being misleading or offensive, or even harmful, would not be adequate, for example, the advertising of prescription medicines.
 I do not want to run the risk of standards failing to be upheld because certain types of advertising fall between the gaps in the legislation's wording. The chosen word, ''unsuitable'', is sufficiently wide to prevent that, so I hope that the hon. Member for Ryedale will see fit to withdraw his amendment.

John Greenway: I am sure that those who are affected by this issue will have the opportunity to read and consider the Minister's remarks. If I
 understand him correctly, in deciding to use ''unsuitable'', the Government have sought a wide definition. It was not our intention to narrow the provision in any way, but it was a good point to raise. With one or two more advertising breaks coming up shortly, I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Andrew Lansley: I beg to move amendment No. 604, in
clause 307, page 265, line 23, at end insert— 
 '(k) that special regard is given to the unique status of the National Lottery and licensed lotteries.'.

Peter Atkinson: With this it will be convenient to discuss the following:
 Amendment No. 605, in 
clause 307, page 266, line 10, at end insert— 
 '(6A) Standards set to secure the standards objective specified in subsection 2(k) shall, in particular, contain provisions designed to ensure that nothing shall directly or indirectly prevent, limit or restrict programme service providers from including in programmes material which— 
 (a) informs viewers and listeners of the benefits to the public from the National Lottery; 
 (b) informs viewers and listeners about the National Lottery and the features of licensed lotteries; 
 (c) educates viewers and listeners on how to participate in licensed lotteries; 
 (d) promotes the National Lottery and licensed lotteries. 
 (6B) In this section and section 312 ''National Lottery'' shall be as defined in section 1 of the National Lottery etc. Act 1993 and ''licensed lotteries'' means those lotteries licensed by the National Lottery Commission pursuant to section 6 of that Act.'.
 Amendment No.606, in 
clause 312, page 269, line 40, after 'sponsorship', insert— 
 '(bb) the National Lottery Commission about so much of the draft code as relates to or could affect the National Lottery or licensed lotteries;'.

Andrew Lansley: I apologise to the Committee for having missed the earlier interesting debates. I look forward to reading them.
 We have moved on to the lottery show. Clause 307, in its application of Ofcom's standards codes, in effect recreates—but gives us the opportunity to consider afresh—the structure of, in particular, the ITC codes of programming and the standards codes. The context of the debate is provided by the fact that the national lottery has a unique status. It is run by a commercial organisation, but one that operates for a public purpose. Committee members will be only too familiar with the benefits that flow from the national lottery, but I imagine that they are equally familiar with the relative difficulties that it has recently encountered. 
 There are inherent difficulties in trying to sustain the take-up of a national lottery programme. Innovation is the necessary response to stimulate the interest of those who play the game and contribute to good causes. The future success of the lottery depends on its ability to innovate. The reason why we have a standards code is because the broadcast media—in particular, television—are an immensely powerful means of communication and can have dramatic effects. In its early years, the national lottery 
 prospered by virtue of its presence on the BBC through the national lottery show.

Michael Fabricant: Is my hon. Friend aware of the argument, often presented by the right hon. Member for Manchester, Gorton (Mr. Kaufman) and others, that Britain seems to be unique in that the show to which my hon. Friend referred is not paid for by the lottery in question, but is put on free?

Andrew Lansley: I understand that to be the case, but I am unsure what conclusion my hon. Friend wants me to draw from that. To put on a show of that sort is consistent with the BBC's wider purposes.
 The question is in what ways the lottery can develop. Past experience in this country and overseas demonstrates that if the lottery is to maximise its contribution to good causes in the long term, some innovation will be required in its ability to promote the lottery through television. Certain constraints on its ability to do that arise from the BBC's sponsorship and advertising code. For example, trailers on the BBC that mention the lottery are regarded as advertising. In addition, because of the restrictions on sponsorship on ITV, even an effort to broadcast the national lottery show on ITV in the same form as it appears on the BBC would fall prey to the sponsorship and advertising code. 
 It is important to consider how the lottery might develop. The lottery might want to develop the nature of games beyond those that appear on the existing show. It might be desirable to the national lottery to 
 consider having a presence on ITV rather than on the BBC, or having a complementary presence on ITV on a different day of the week. Much as I have my worries about scratchcards and the ability under gaming policy to chase losses, it might be an advantage in the context of the lottery to be able to introduce a scratchcard game, related to a lottery show, with winners in the studio, so that viewers could watch the experience of winning. Such entertainments could enable the lottery to capture an additional audience, and thereby additional money for good causes. 
 The amendments would enable the standards codes to reflect the unique character of the lottery. The hon. Members for Milton Keynes, North-East (Brian White) and for North Devon and I have come together to table amendment No. 605 to try to secure the Government's acceptance of the amendments. If the amendment were accepted, the programming material set out in the amendment that informs viewers about the national lottery, educates them and promotes the national lottery and licensed lotteries, would be reflected in the legislation as material that will not be precluded by programming or standards codes. I hope that the Government will accept it. 
 It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order. 
 Adjourned till this day at half-past Two o'clock.